Getting Visual With Uncertainties
William lives and works as an IT project manager in South Florida, and is a member of the South Florida chapter of PMI. He created StatisticalPERT.com.
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Topics: Cost Management, Estimating, Risk Management, Schedule Management, Scheduling
What if we re-imagine the project charter to include visual information about the project uncertainties we face? How would that help convey project risk to sponsors and executive stakeholders?
On many project charters, there is a high-level budget and schedule; but too often, these estimates are conveyed using deterministic (single-value) estimates instead of using ranges. Sharing only single-outcome estimates of the future fails to convey project risk, uncertainty and the project team’s nascent project knowledge.
A far better approach is to use visual signals to help project sponsors sense the uncertainties that they and their project teams face. Everyone needs to understand these uncertainties—especially project sponsors, who must wisely decide which projects to fund (and not to fund). Sponsors need to align with project teams on what’s possible, what’s probable, what’s feasible and what’s infeasible.
Visual signals help achieve this.
The Beta Probability Distribution
Lately, I’ve been experimenting with the beta probability distribution using Statistical PERT Beta Edition, a free, Excel-based spreadsheet that uses Excel’s built-in beta distribution statistical functions (without any macros!). Using Statistical PERT’s tri-colored bell curve, I can customize my Excel chart to convey a wide range of …
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